Government taking steps to improve governance at SOEs

Thursday, April 26, 2018

Deputy President David Mabuza says steps have been taken to address governance challenges at State-owned entities.

The Deputy President said this when he answered questions at the National Assembly on Wednesday.

Steve Swart, a Member of Parliament from the ACDP, had asked if any steps have been taken since 27 February 2018 to improve the lack of accountability and enforcement of sanctions against board directors and management of state-owned enterprises.

During his State of the Nation Address (SONA), President Cyril Ramaphosa announced that among the steps taken to address challenges at state-owned entities, a Commission of Inquiry into State Capture headed by Deputy Chief Justice, Judge Raymond Zondo, is expected to commence its work soon.

The Deputy President said as part of the SONA implementation process, with respect of Eskom, a new board has been appointed and that the power utility now has a new acting CEO and acting CFO.

He said disciplinary action has been taken against at least eight senior managers to start the process of rooting out corruption and stabilising its financial position.
“As action in terms of these interventions was intensifying, we have had some of these individuals opting to resign from their positions before disciplinary hearings could even sit to determine their guilt.
“The process of appointing a fulltime CEO and CFO is almost complete. The issues pertaining to coal supplies to some of its power stations is receiving attention,” he said. 
The Deputy President said all Boards of state owned companies are in the process of being reviewed and strengthened.

This includes Denel, where changes have been effected with the announcement of a new interim Board. He said the same has been done at PRASA.

“Boards of SOCs have been directed to focus on addressing all governance failures that have impacted negatively on performance.
“In addition, boards will prioritise the recovery of stolen funds and undertake a review of all contracts to identify those that may have been improperly awarded,” he said. 
The Deputy President said where there are criminal offences, charges must be brought against individuals through the relevant authorities to ensure that those involved are brought to book.

“The instances of maladministration and corruption at State-Owned Companies identified by reports from the office of the Public Protector, including Parliamentary inquiries, have assisted a great deal in highlighting the extent of the problem and the Executive take these issues seriously.” –

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